There are so many reasons why people go to court to file a bankruptcy petition.
Soaring medical bills and recession in the economy could be some of the reasons that many people opt for filing a petition.
The most important thing is to have the protection of the court against the creditors who would otherwise harass the you for payment of debts.
There are mainly two chapters under which an individual can fie a financial distress petition.
The liquidation chapter allows for the debtors assets to be sold and the proceeds to be divided amongst the creditors while in the wage-earner or chapter 13, the debtor continues to work as they make monthly payments towards the debt.
Some people worry about what will happen to them in case their spouse filed a bankruptcy petition in court.
It is important for such people to know that the debtor is expected to continue paying a monthly fee towards child support and former spouse support.
Unlike in the cases of other debts, these cannot be discharged.
In cases where the financial distress has happened before a divorce and yet the couple wish to go on their separate ways after the bankruptcy, it would be better if they first finished with the financial crisis first before they can go through the divorce.
This way the debts between the couple will be a less burden to carry in case they went their separate ways.
It will make the divorce process a simpler one.
In cases where the debt falls in the name of both spouses, it would be much better for the couple to go to court together to file a financial distress petition.
This way, the costs will be bearable than when they its done separately.